The House on Tuesday evening rejects debt limit increase without cuts. 

The vote was 318-97 against raising the debt ceiling, far below the two-thirds majority needed for passage.

No Republicans voted for the bill.

The vote came as no surprise. 

President Obama will have a chance to address House Republicans on budget issues directly on Wednesday.

According to Laena Fallon, a spokeswoman for House Majority Leader Eric Cantor (R-Va), The markets are very sophisticated, and there's been no indication that tonight's vote will have an impact on them. If anything, it reinforces the need to control and lower our debt, which the markets need.

I consider defeating an unconditional increase to be a success, because it sends a clear and critical message that the Congress has finally recognized we must immediately begin to reign in America's affection for deficit spending, said House Ways and Means Chairman David Camp (R. Mich).

Markets so far have seemed to like the news.  Risk appetite in FX has gained across the board, US Dollar down against all the Majors.

EUR/USD - 1.4430 currently up 30pips overnight

AUD/USD - 1.0690 currently up 20pips overnight